Property news round up 29 Apr 2018

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Oxley tipped to clinch Pei Fu Industrial Building

OXLEY Holdings is expected to clinch Pei Fu Industrial Building off Upper Paya Lebar Road in what could be the first collective sale of an industrial property to be awarded this year.

The Business Times understands that the mainboard-listed group will be paying S$76.25 million for the freehold property in New Industrial Road.

The expected transaction price, which surpasses the reserve price of S$75 million, works out to S$489 per square foot per plot ratio (psf ppr), based on the proposed gross floor area (GFA) of 155,864 square feet (sq ft).

Ascendas Reit’s Q4, full-year DPU up on acquisitions

ASCENDAS Reit on Monday reported an increase in distribution per unit (DPU) to 3.91 Singapore cents for its fourth quarter ended March 31, 2018.

This is higher than the 3.852 Singapore cents it paid out a year ago.

Gross revenue of the trust rose 3.3 per cent to S$215.7 million, while net property income rose 2.5 per cent to S$157.9 million, as the contributions from the acquisition of 108 Wickham Street in Brisbane, Australia last December kicked in, partly offset by the divestment of 84 Genting Lane in Singapore in January this year.

Notably, the trust recorded a foreign exchange loss of S$29.9 million in the quarter, mainly from the maturity of certain cross-currency interest rate swaps that matured in its fiscal Q4. A year ago, it had seen a S$26 million foreign exchange gain.

Also read: Divergence of Singapore’s price and rental trends

Sabana Reit’s DPU constant at 0.88 Singapore cents

LOWER contributions from some of its properties, cushioned by reduced property expenses, dented results for landlord Sabana Shari’ah Compliant Industrial Real Estate Investment Trust (Sabana Reit) in its first quarter ended March 31.

Distribution per unit (DPU) was flat at 0.88 Singapore cents, thanks to the manager forgoing 20 per cent of its base fees in a goodwill move.

DPU would have been 0.86 cents, up from 0.80 cents from the year-ago quarter when it waived 75 per cent, or S$944,000, of base fees.

Q1 income available for distribution slipped 0.8 per cent to S$9.2 million from the previous year.

Freehold site in Jalan Besar for sale by expression of interest

A FREEHOLD commercial site at the former New World Amusement Park along Jalan Besar has been launched for sale via an expression of interest (EOI) exercise.

On Monday, marketing agent JLL said the indicative guide price of the site is about S$13.5 million, reflecting a unit land rate of S$1,392 per square feet per plot ratio (psf ppr).

No development charge is payable for the intensification of the site.

Two freehold sites going en bloc

PARK HOUSE in Orchard and St Michael’s Condominium in Serangoon have joined the collective sale frenzy with guide prices of S$308 million and S$112 million respectively.

The S$308 million reflects a land rate of approximately S$2,387 per sq ft per plot ratio, or S$2,170 per sq ft per plot ratio after taking into consideration the 10 per cent bonus gross floor area allowed for balconies.

Owners of Park House’s 56 apartments, which are approximately 1,571 sq ft each, will receive at least S$5 million, while owners at the four shops, at about 1,528 sq ft each, will receive at least S$6.65 million, said marketing agent CBRE in a statement.

Could a Singapore heritage shophouse Reit take off?

THE value of shophouse transactions year to date has crossed the S$500 million mark, and is expected to close the year matching if not surpassing last year’s tally of S$1 billion – which was the highest in four years.

The buoyant mood has resulted in rising prices, especially for conservation shophouses in Districts 1 and 2. Demand for such properties has been strong from local and foreign high net worth individuals (HNWIs) as well as property funds and investment companies.

Investors believe that the limited supply in this asset class bodes well for long-term capital appreciation.

Also read: Few differences between REITs that own Singapore vs overseas assets

CapitaLand Commercial Trust Q1 DPU down 11.7%

CAPITALAND Commercial Trust (CCT) posted a lower distribution per unit (DPU) of 2.12 Singapore cents for the first quarter from 2.40 Singapore cents the year before.

This was due to an enlarged number of CCT units arising from the issue of new units from a rights issue in October last year, conversion of convertible bonds in fiscal 2017, and the issue of units for management fees.

For the three months ended March 31, 2018, DPU restated for the rights issue for Q1 2018 was 2.12 Singapore cents, down from 2.34 Singapore cents in Q1 2017.

MCT Q4 DPU up 0.01 cent, full-year DPU at 9.04 cents

DISTRIBUTION per unit (DPU) for Mapletree Commercial Trust in its fourth quarter ended March 31 crept up to 2.27 Singapore cents from 2.26 Singapore cents.

This will be paid on May 31, and books will close May 3. That came as Q4 income available for distribution crept up 0.4 per cent to S$64.8 million from the preceding year.

Gross revenue edged up 1.3 per cent to S$108.9 million from the year-ago period, while net property income increased to 1.2 per cent to S$84.3 million from the previous year.

ESR-Reit acquires Tampines logistics facility for S$95.8m

ESR-REIT announced that it had on Monday entered into a conditional agreement with vendor Tampines Distrihub to acquire a logistics facility for S$95.8 million.

The purchase price includes a consideration of S$86.2 million and an estimated S$9.6 million land premium payable for the balance lease term.

In total, the acquisition cost amounts to S$99.9 million, factoring in stamp duties of S$2.9 million and S$1.2 million in other transaction costs.

Pei Fu building in S$76.25m collective sale

NEWLY-LISTED SLB Development announced on Tuesday that subsidiary Oxley Kyanite has exercised the option to acquire freehold Pei Fu Industrial Building for a total of S$76.25 million.

The transaction price, reported earlier by The Business Times, surpasses the reserve price of S$75 million, and works out to S$489 per square foot per plot ratio (psf ppr), based on the proposed gross floor area (GFA) of 155,864 square feet (sq ft).

This unit land rate does not include a development charge that may be payable to the State, as the development baseline has yet to be ascertained.

The acquisition – brokered by William Gan Realty – was undertaken by Oxley Kyanite Pte Ltd, in which SLB has an indirect 51 per cent interest with mainboard-listed Oxley Holdings owning the remaining 49 per cent share.

Also read: Own a piece of the ex Shunfu Ville with Jade Scape condo

Cromwell European Reit buying freehold office building in Italy

CROMWELL European Real Estate Investment Trust (Reit) is acquiring a freehold office building at Via Jervis 13, Ivrea, Italy, for 16.9 million euros (S$27.3 million).

On Tuesday, Cromwell EReit Management, the manager of Cromwell European Reit, said that Perpetual (Asia), the Reit’s trustee, has entered into a preliminary sale and purchase agreement on Monday with Savills Investment Management SGR PA.

Savills Investment Management SGR PA is the management company of C3 Investment Fund, an alternative investment fund established in Italy with 100 per cent of its units held by Cerberus SICAV-SIF.

JTC tenders 2 sites in Tuas, releases one site for sale application

JTC has put up for tender two industrial sites in Tuas and released another in the same area for application for sale, it announced on Tuesday.

For tender is one Confirmed List site at Tuas South Link 3 (Plot 26) and a Reserve List parcel at Tuas South Link 1 (Plot 13) under the first half 2018 Industrial Government Land Sale (IGLS) programme

The tender of the Reserve List site was triggered after JTC received an application for the sale, with a committed bid price of not less than S$15,583,700.

The offices of the future, in the Weekend magazine

CO-WORKING spaces are no longer the casual, bohemian, hot-desking -with-beanbags setup that they used to be. As millennials get older and more sophisticated, and more players come into the picture, shared spaces have evolved into upscale operations housing entrepreneurs, SMEs and even larger companies.

In Friday’s issue of Weekend magazine, we look at how co-working spaces may be the offices of the future.

AA Reit Q4 DPU falls to S$0.0263

AIMS AMP Capital Industrial Reit (AA Reit) on Wednesday reported a lower distribution per unit (DPU) of 2.63 Singapore cents for the fourth quarter, from 2.78 Singapore cents a year ago.

DPU in fiscal 2018 was 10.30 Singapore cents, down from 11.05 Singapore cents in FY 2017.

This was partly due to an increase in units from a private placement of 42.1 million units in December 2017.

Also read: The economics of DIY real estate platforms

Retail, convention business lifts Suntec Reit’s Q1 DPU by 0.3%

SUNTEC Reit’s Q1 distribution per unit (DPU) rose 0.3 per cent to 2.433 Singapore cents per unit, mainly driven by the its retail and convention business.

Total distributable income for the quarter came in at S$64.8 million, 4.8 per cent or S$3 million higher than the year-ago period.

Net property income rose 1.9 per cent to S$63 million from the preceding year, mainly attributable to higher contribution from its 60.8 per cent interest in Suntec Singapore Convention & Exhibition Centre (Suntec Singapore).

BlackRock buying Admiralty industrial property for S$106m

BLACKROCK, which exited the Asia Square development in the Marina Bay area last year, is understood to be buying a high-specification light industrial building on Admiralty Street for S$106 million.

Admirax, a seven-storey property in the Woodlands area that received Temporary Occupation Permit in 2009, is being sold by a unit of Ascendas-Singbridge.

The Business Times understands that an entity linked to BlackRock has entered into a sale-and-purchase agreement for the property.

Samsung Hub level 20 sold for S$3,550 psf

AN office floor at Samsung Hub along Church Street has been sold for S$46.62 million or S$3,550 per square foot based on its strata area of 13,132 sq ft.

On psf basis, this is the highest in the 999-year leasehold building, which is in the Raffles Place financial district.

A company whose shareholders include an Indonesian was granted an option recently to buy the entire 20th floor of the 30-storey building.

Bidders tussle for 2 out of 3 residential sites under govt land sales programme

THE latest batched government tender closings of three 99-year leasehold residential sites on Wednesday saw developers flocking to the sites at Cuscaden Road and Mattar Road, and setting a new high in land rate for the prime Cuscaden Road site.

But the large site in Silat Avenue pulled in only one developer. For the Cuscaden Road site within the prime Orchard Road district, the top bid from SC Global Developments, New World Development and Far East Consortium International was S$410 million.

Also read: Riverfront residences (ex Rio Casa) up for sale

Lakeside Towers, Jalan Besar Plaza go en bloc

TWO more developments jumped on the en bloc bandwagon on Thursday.

Real estate marketing agent Huttons Asia said that owners of Lakeside Towers have put up the 99-year leasehold project overlooking Jurong Lake Gardens for public tender and are expecting a price of S$305 million for the development.

“Based on the estimated differential premium and lease upgrading premium payments of S$57 million to intensify the land and for topping up to a fresh 99-year lease, this translates to a land rate of S$1,125 per square feet per plot ratio (psf ppr),” Huttons said.

CapitaLand signs MOUs to explore projects in Zhejiang

CAPITALAND is set to broaden its master planning and urban design capabilities in China through new strategic partnerships in China’s Zhejiang province.

The company announced on Thursday that it has signed two Memoranda of Understanding (MOUs) to explore developing and managing large-scale business park and township projects in Ningbo and Jiaxing, two fast-growing cities in the eastern province, through its wholly owned subsidiary CapitaLand China.

The signings were made at the 13th Singapore-Zhejiang Economic and Trade Council meeting in Zhoushan, and were witnessed by Singapore’s Senior Minister of State for Trade and Industry Sim Ann and Zhejiang vice-governor Zhu Congjiu.

Decline in industrial property prices, rents slows as sector activity rises

INDUSTRIAL property prices and rents could hit an inflection point this year as sector activity picks up and as new supply begins to gradually lessen in the coming years.

JTC’s market report for the first quarter of 2018 showed that both prices and rentals dipped just 0.1 per cent compared to the fourth quarter of 2017.

While that is the 12th quarter of consecutive decline for both indices, analysts noted that the rate of decline has slowed and become relatively stable. There have been signs of better demand in the markets, they added.

JLL Singapore’s head of research and consultancy Tay Huey Ying said that it had observed a pick-up in leasing enquiries from industrialists in the first quarter.

Some occupiers have also acted fast to secure their premises ahead of what they believe will be a rental recovery to come, she said.

Also read: The great southern waterfront and the impact on Singapore

Mapletree Logistics Trust Q4 DPU up 4%

MAPLETREE Logistics Trust’s (MLT) fourth-quarter distribution per unit (DPU) rose 4 per cent to 1.937 Singapore cents amid a strong performance driven by organic growth, contributions from a newly-completed redevelopment in Singapore, as well as acquisitions.

The distribution will be paid on June 6.

The trust manager also announced plans to acquire a 50 per cent stake in each of 11 logistics properties in China for about 985.3 million yuan (S$206 million).

From boring to booming

YOU know there’s money to be made from investing in data centres, when one of Singapore’s most astute investors and tycoon Oei Hong Leong is throwing his weight behind a US$5 billion fund aimed at developing an ecosystem of data centres.

These staid buildings, housing vast banks of networked computer servers that power the global economy, are now looking attractive to a broad spectrum of investors.

What used to be a niche asset class is now almost mainstream real estate.

While not the sexiest of businesses, data centres have become crucial infrastructure in an economy where data consumption and mobile penetration is steadily rising, businesses have gone digital, and everything is “in the cloud”.

Operators of data centres are capitalising by ramping up capacities globally to meet exploding demand.

Institutional investors have been quick to sniff out the opportunities, and the likes of Blackstone, Singapore sovereign wealth fund GIC, Mapletree Investments and Keppel Corporation have already jumped into the sector.

Outlook sunny for private residential market after Q1, but all eyes on big supply pipeline

ANALYSTS continue to harbour bullish outlook on the private residential market, following a 3.9 per cent increase in prices in Q1, but are keeping an eye on the pace of launches that may come onstream, given the huge supply pipeline.

They are, however, split on whether there is enough demand to soak up the impending supply boom.

An estimated 40,300 uncompleted units with planning approvals, excluding executive condominiums (ECs), were in the pipeline as of end-Q1. The figure was 36,029 in the previous quarter.

Also read: Garden residences by Wing Tai and Keppel Land

Private home rents on the mend, with some help from en bloc sellers

PRIVATE home rents are finally seeing green shoots and could continue to grow this year thanks to the collective sale frenzy.

The rental index edged up 0.3 per cent in the first quarter after 17 quarters of contraction or zero growth, according to Urban Redevelopment Authority (URA)’s statistics released on Friday.

Landed property rentals remained unchanged, compared to a 1.3 per cent decrease in the fourth quarter.

UIC Q1 net profit rises 1% to S$60.24m

UNITED Industrial Corporation (UIC) reported a net profit of S$60.24 million for the first quarter ended March 31, which represented a 1 per cent improvement from a year ago.

This was despite a 37 per cent drop in revenue to S$165.65 million due to lower sales recognition from trading properties.

Mitigating the decline were a 43 per cent decline in selling and distribution costs to S$4.93 million, as well as an improvement in the group’s share of results of associated companies and joint ventures.

Local retail property market shows signs of emerging from a slump, but strong rebound not expected

SINGAPORE’S retail property market could finally be emerging from the doldrums, following a three-year battle against disruption brought about by technology amid rising operational costs and weak consumer sentiment.

JLL noted the broad-based stabilisation in this market segment, saying that for the first time in three years, the retail price and rental indices of the Urban Redevelopment Authority (URA) have entered into the positive territory across all regions tracked.

JLL’s head of research and consultancy, Singapore Tay Huey Ying said: “This came on the back of firm island-wide vacancy rate in the private sector, at 8.1 per cent in both the fourth quarter of last year and the first quarter of this year.”

LHN acquires Cambodian condominium block for US$12.5m

LHN is acquiring 108 freehold apartment units in Cambodia for US$12.5 million, the property developer said on Thursday.

The units comprise all the condominium units in Block 1A of Axis Residences (right), which is to be developed by the seller, Spring CJW Development.

LHN intends to nominate its indirect wholly-owned subsidiary, LHN Cambodia, to hold the target units.

Situated in the capital Phnom Penh, Axis Residences will have a total area of 5,748.37 square metres of net private area, and 8,047.72 sq m of gross area including common facilities which LHN Cambodia has the rights to use.

Also read: All the REIT data you need in one place

Singapore office market continues recovery in Q1: URA

LATEST data from the government show that the recovery in the Singapore office market continued in the first quarter of this year.

The Urban Redevelopment Authority’s rental index of office space in the Central Region rose 2.6 per cent in the first quarter of this year over Q4 2017.

This is the same pace of quarter-on-quarter increase as in Q4 2017 and marks the third consecutive quarterly rise in the index since it bottomed in the second quarter of 2017; the index has chalked up a cumulative recovery of 7.7 per cent in less than a year.

URA’s price index of office space in the Central Region rose 1.3 per cent in the first quarter, a slower pace of increase compared with the 2.7 per cent rise in the previous quarter.

MYP unit to sell MYP Plaza at 135 Cecil Street for S$247m

MAINBOARD-listed MYP announced on Friday that it has, through wholly-owned subsidiary Affreton, agreed to sell freehold MYP Plaza at 135 Cecil Street for S$247 million.

According to an exchange filing, the buyer is affiliated to Filipino billionaire Lucio Tan’s group of companies, a conglomerate based in the Philippines.

The property in question is a 14-storey freehold office tower located in the central business district, and has a net lettable area of around 82,334.28 sq ft with three basement carpark levels.

Also read: All the residential market data you need in one place

BT REITS 28 Apr 2018